Wyndham Stock Ripe for a Buy
PARSIPPANY, N.J. (
) -- Shares of
Wyndham Worldwide
(WYN)
continued to fall for a second consecutive trading day on Monday morning, but the stock may now be oversold according to one research firm.
Wyndham's share price entered into oversold territory with a stochastic value of 17.45, according to
Zacks Investment Research
.
A
is a technical momentum indicator that compares the closing price of a stock to its price range over a period of time.
A stock is generally considered oversold when its price has fallen enough that an oscillator reaches a lower bound. When that happens, the undervalued equity could represent an inexpensive buying opportunity for investors.
Wyndham's stock fell marginally on Friday to close at $24.75 on Friday, and lost another 1.6% Monday morning, to $24.36. In the trailing 52 weeks, the stock traded between $27.94 and $14.12.
Zacks upped its forecast for Wyndham's full year earnings by 17 cents per share in the past month to $1.87, and has a strong buy rating on the stock.
Analysts polled by Thomson Reuters expect the hotel operator to earn $1.85 per share in 2010 on revenue of $3.84 billion.
Wyndham said last month its system-wide revPAR, or revenue per available room, declined 1.2% last quarter, but sales momentum across the company's three business segments -- lodging, vacation rentals and vacation ownership -- helped push total revenues up 5% year-over-year to $963 million, easily beating expectations for sales of $940.2 million.
RevPAR rose in June, the company said, and it continued to see "meaningful improvement" during the first three weeks of July. That strengthening led Wyndham to raise its revPAR expectations for 2010 to growth as much as 3%, compared with its previous estimates for flat or a 3% decline in revPAR.
Marriott International
(MAR) - Get Report
forecast revPAR growth between 4% and 6% this year, while
Starwood Hotels & Resorts
(HOT)
expects growth in the key metric to jump between 7% and 9%. InterContinental did not provide specific revPAR guidance.
InterContinental Hotels
(IHG) - Get Report
, the operator of InterContinental, Crowne Plaza and Holiday Inn hotels, did not offer specific guidance for the year but said recently its
global revPAR grew 3.9% in the first half of the year
, including a 7.4% jump in the second quarter. Strengthened demand was attributed to a pickup in business travel and growth in China, and the trend is likely to continue.
RevPAR in July jumped 8.1% worldwide, InterContinental said, led by a 15% increase in its Asia Pacific region, 10% growth in Europe, the Middle East and Africa, and 6.4% growth in the Americas.
Marriott shares fell 0.8% Monday morning while Starwood edged 0.1% lower. InterContinental shares added 1.3%.
-- Reported by Miriam Marcus Reimer from New York.
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